NBN suspends construction tender process: Midday Roundup

The NBN Co. has suspended the tender process for the key construction job for the project after concerns the prices submitted by construction companies were just too high.

NBN Co. head of corporate services Kevin Brown said the company would not build the network “at any price”.

“We have thoroughly benchmarked our project against similar engineering and civil works projects in Australia and overseas and we will not proceed on the basis of prices we are currently being offered,” Brown said in a statement.

“NBN Co. is confident it can secure better value for money by going a different route.”

Reports have suggested the high prices submitted by companies on the 14-strong shortlist could have added more than $3 billion to the cost of the $36 billion project.

Manufacturing suffers

The latest Australian Industry Group-PwC Australian Performance of Manufacturing Index fell into the red last month, on the back of the strong Australian dollar, weak domestic demand and rising competition from overseas, AiG said.

It fell a seasonally adjusted 3.2 point to 47.9, taking it into the contraction level of below 50.

According to the survey, clothing and footwear, food and beverages and textile and fabricated metals experienced the greater downturn over the month.

Biota shares surge on new contract

Shares in drug maker Biota have soared by 57% in morning trade to $1.60 after the company revealed it has won a five-year, $US231 million contract from the US Government to develop a long-acting, single-dose flu drug for sale in the US.

The drug, called Laninamivir, has been approved for sale in Japan but not in other markets. Under the terms of its new agreement the company will need to establish a US manufacturing base and conduct the clinical trials needed to get the drug approved by the US Food and Drug Administration approval.

“The award provides visible recognition of the potential medical value of Laninamivir to the world’s major market,” Biota chief executive Peter Cook said in a statement.

Local market set to end week on a high

The Australian sharemarket is expected to end the week on a stronger footing, after the local currency reached yet another record high and digested a weak manufacturing survey.

At just after midday, the benchmark S&P/ASX200 index had lifted 0.61% to 4,867.8 points, while the broader All Ordinaries index had jumped 0.62% to 4,959.3 points.

While the market is awaiting key data from tonight, it is lifted by a strong performance by resource and financial stocks.

Good quarter for US stocks, but flat night on Wall Street

Overnight, US stocks ended flat but clocked up a 5.4% gain for the first quarter, as investors await a key US jobs report tonight which is expected to show up to 190,000 new jobs were created in the month of March.

While the S&P 500 is yet to tip over the psychological 1330 level, there are hopes positive releases will push it over the edge, with investors drawing confidence by the market’s performance during the geopolitical turmoil that rocked the first three months of 2011.

In a mixed night, the Standard & Poor’s 500 closed down 0.18%, to 1,325.83, the Nasdaq Composite gained 0.15%, to 2,781.07 and the Dow Jones industrial average edged down 0.25% to 12,319.73.

More new heights tipped for the AUD

The Australian dollar reached yet another record overnight, of 103.73 US cents, buoyed by a greater international risk appetite, its perception as a ‘commodity’ currency, Australia’s links to China, and moves by the US Federal Reserve to push down the value of the greenback.

One economist, Clifford Bennett of Herston Economics, has tipped the local currency will reach 108 US cents by the year’s end, The Age reports.